Las Vegas Sands is selling the iconic Venetian casino resort and its Sands Expo and Convention Center for $ 6.25 billion, withdrawing from gambling operations on the Las Vegas Strip after changing the nature of the casino business there and in almost everyone the other places.
The Venetian name, the exhibition center and also the Palazzo, the luxurious Sands casino and resort that is part of the same complex, will remain, and the company’s headquarters will be in Las Vegas.
But the company led by Sheldon Adelson until his death this year will effectively end operations in the United States. With Adelson, the company’s focus turned to Asia years ago, where revenue ended up even surpassing operations on the Las Vegas Strip.
According to the two-party agreement announced on Wednesday, VICI Properties will buy the casino and resort and all assets associated with Venetian Resort Las Vegas and Sands Expo for $ 4 billion. And Apollo Global Management will acquire Venetian’s operations for $ 2.25 billion.
The global pandemic hit Las Vegas, closing the Strip, where Las Vegas Sands has been the biggest operator for years. Sales growth disappeared last March, as infections spread across the United States. The company posted a quarterly loss of nearly $ 300 million in January.
The sale comes just two months after Adelson’s death, which transformed the famous Las Vegas casino, which was once a meeting point for Frank Sinatra’s Rat Pack, into an imposing Italian-inspired complex.
Adelson reshaped the target audience in Vegas, focusing on congressmen and even families. He acknowledged that the real potential was not on the casino floor, as it was in the 1960s, but in the hotels, resorts and convention centers that surround them.
After explosive growth in Las Vegas, Adelson turned his eyes to Asia. Sands expanded to Macau, the only place in China where casino gambling is legal, where Adelson directed his company to build land where it didn’t exist, piling up sand to create the Cotai Peninsula. Operations in Asia quickly outperformed those in the United States
Sands said on Wednesday that the company’s focus will remain on Asia.
“The Venetian has changed the face of future casino development and has consolidated Sheldon Adelson’s legacy as one of the most influential people in the history of the gaming and hospitality industry,” said President and CEO Robert Goldstein. “In announcing the sale of The Venetian Resort, we pay tribute to Mr. Adelson’s legacy by starting a new chapter in the history of this company. This company is focused on growth and we see significant opportunities on a variety of fronts. Asia remains the backbone of this company and our developments in Macau and Singapore are the center of our attention. ”
Some industry analysts also expect Sands to use the proceeds from the sale to invest more aggressively in online gambling, something Adelson had lobbied against.
“His efforts so far have been left behind and in order for him to become involved in the game’s next big success, the company would probably have to buy his ticket and now has a lot of money for that,” wrote JPMorgan analyst Joseph Greff.
VICI will enter into a net triple lease with Apollo for the Venetian. The lease will have an initial total annual rent of $ 250 million and an initial term of 30 years, with two 10-year tenant renewal options.
The Venetian, located on the Las Vegas Strip, has three luxury hotel towers with games, entertainment, shopping and restaurants. The resort includes more than 7,000 suite-only rooms, 225,000 square feet of gaming space and 2.3 million square feet of meeting space.
Travel-related companies, from airlines to hotels and resorts, are coming back with the launch of a series of new vaccines.
Apollo partner Alex van Hoek said in a prepared statement that the agreement “reinforces our belief in a strong recovery in Las Vegas, as vaccines inaugurate the reopening of leisure and travel in the United States and around the world. ”.
The sale is expected to close in the fourth quarter.